Orbiter has a device data called "Path" (go to pluto-admin website and click on your orbiter device, then scroll down on the bottom of the page). First, Orbiter tries to download UpdateBinary application to that Path. If it fails, it tries to download it in Orbiter's folder, which should always succeed. Can you send me Orbiter’s log file located on Orbiter's folder ? My email is chris.m (address@plutohome.com).

You don't have to reinstall Windows XP/CE orbiters every time you get a new release from Pluto. The orbiters have a built-in self update mechanism: each time you're restarting them, they are comparing the file from the server with the one used locally; if the files are different, the orbiters spawn an application called UpdateBinary/UpdateBinaryCE which downloads the latest binary from the core and then restart the orbiter.